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Reuters
5 hours ago
- Business
- Reuters
Lawsuit challenges FTC authority over 'unsubstantiated' advertising claims
June 18 (Reuters) - Hygiene products maker Xlear sued the U.S. Federal Trade Commission on Wednesday, accusing the agency of overstepping its authority to regulate false and deceptive advertising by requiring advertisers to "substantiate" claims about their products. Xlear, whose products are sold in major U.S. retailers and pharmacy chains, filed the lawsuit, opens new tab in federal court in Utah after the agency in March dropped a four-year-old lawsuit that had accused Xlear of falsely claiming its saline nasal spray could prevent and treat the COVID-19 virus. The complaint seeks a court declaration that companies do not violate FTC rules by making statements that are allegedly unsubstantiated. 'This lawsuit argues that the FTC is grossly overreaching in its interpretation of the law,' said Rob Housman, an attorney for Xlear. 'The FTC Act doesn't say anything about requiring companies to have 'substantiation.'' The Federal Trade Commission declined to comment. Xlear in its lawsuit cited a U.S. Supreme Court ruling in 2024, Loper Bright Enterprises v. Raimondo, that overturned a key 1984 precedent requiring judges to give deference to agencies in their interpretation of the laws they administer. Housman said that under the justices' ruling an agency 'can't just invent new rules not found in the law.' The FTC's lawsuit in 2021 alleged Xlear had no scientific or factual basis to make its COVID claims, and said the company's alleged deceptive advertising and misinformation 'to sell their product to concerned consumers during a pandemic poses a risk to public health and safety.' In seeking dismissal of that case, Xlear denied making any deceptive statements. Xlear said it spent upwards of $3 million defending itself against the FTC in what the company called "vexatious litigation." The FTC did not provide a reason for dropping the case earlier this year. The case is Xlear Inc v. Federal Trade Commission, U.S. District Court, District of Utah, No. 2:25-cv-00484. For plaintiff: Robert Housman of Book Hill Partners, Evan Strassberg of Michael Best & Friedrich and Ronald Price of Price Parkinson & Kerr For defendant: No appearance yet Read more: US agencies face fees over faulty cases, Ford seeks $300 million from lemon law lawyers US appeals court orders revised penalty in FTC 'Do Not Call' case US Supreme Court curbs federal agency powers, overturning 1984 precedent
Business Wire
9 hours ago
- Business
- Business Wire
Xlear Sues FTC for Unlawful Scientific Censorship
SALT LAKE CITY--(BUSINESS WIRE)--Today, Xlear, a consumer hygiene products company, filed a ' Loper lawsuit' in Utah Federal District Court against the Federal Trade Commission (FTC). The lawsuit seeks declarative relief holding that the FTC cannot require entities to have substantiation for marketing claims under the FTC Act. Rob Housman, Xlear's lead lawyer explained: 'Under the Supreme Court's decision in Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024) a Federal agency applying a statute is limited to what the specific language of the law says on its face. And, Loper goes on to require that if the agency is interpreting the statute, its interpretation must be the 'best' reading of law. The FTC Act says nothing about requiring substantiation. And, for a host of reasons—most importantly violations of the First Amendment and Due Process Clause—the FTC's interpretation of the FTC Act is far from the 'best'. As such, we are petitioning the Utah District Court to invalidate the FTC's substantiation requirement.' In 2021, the FTC sued Xlear alleging that the company lacked sufficient substantiation for statements the company made its Xlear Nasal Spray was an effective added layer of protection against the COVID-19 virus. Throughout the lawsuit, Xlear maintained that the science supported Xlear's COVID claims. On March 10, 2025, the Department of Justice, acting on behalf of the FTC, asked the court to drop the lawsuit with prejudice (Xlear joined in the motion). About this new lawsuit, Nate Jones, Xlear's CEO, said: 'We agreed with the Government to drop the prior lawsuit because we wanted to get back to the business of helping Americans get and stay healthy through great oral and nasal hygiene products. However, we very much wanted our day in court. We wanted to stop the FTC's illegal misuse of the FTC Act to censor science. The effect of this is to stifle health innovation—which benefits Big Pharma over cutting-edge smaller companies with new approaches. We wanted to protect the right of all Americans to have access to science-based health information. By filing this lawsuit, we are pushing ahead with combating the Government's censorship of science.' Jones added, 'Ironically, while the FTC demands substantiation from companies, they really don't care about science. Before the FTC sued us for substantiation, we sent them scores of studies that backed our claims. During the lawsuit the FTC admitted that not one single doctor or medical researcher had looked at the data we provided before they filed the suit.' Xlear manufactures a suite of hygiene products ranging from Xlear nasal sprays to Spry toothpaste, which are sold at leading retailers across the country and online through The company's is based in American Fork, Utah. More information about Xlear and its products, as well as the complaint can be found at
